All Forum Posts by: Miller McSwain

What a creative solution!

A potential issue though is that DSCR likely requires 25%+ down (I would imagine).
A HUGE benefit of using conventional/FHA as a owner-occupant is that you can put 5% down on a single-family or 15% down on a duplex.

I'd be interested to hear from a DSCR lender though to see if any offer 15% down (or less) products.

If you are interested in a duplex, I would DEFINITELY use the FHA. The less money you put down, the lower your cashflow (because your mortgage payment is higher and you pay PMI); however, your cash-on-cash ROI is higher because you put so little down. PLUS, like you said, you would then have lots of cash left over to invest elsewhere OR purchase another house-hack duplex a year later.

One thing to note: for duplexes, Conventional requires that you put at least 15% down if you are an owner-occupant. For a single-family, Conventional allows you to put 5% down. 
So if you were interested in single-family, I would recommend Conventional (like @Karl McGarvey said) because the inspections/appraisals are more stringent for the FHA, and because 5% down is pretty close to 3.5% down.
But in the case of the duplex, even though you may have more strict inspections/appraisals, 3.5% down will yield much higher cash-on-cash ROI than the 15% down.

Let me know your thoughts!

There are lots of "property management softwares".
I'm a rent-by-room single-family investor in Colorado Springs, and I recently looked through the most popular softwares and selected one. The products I investigated were:
1. Tenant Cloud
2. Apartments.com
3. Innago
4. Avail
5. RentRedi

I was looking for a software that met the following criteria:
1. Online payments from tenants
2. Automatic late fees
3. Maintenance request portal
4. Free for the landlord
5. Online applications
6. Tenant screening (background checks, etc)
7. Lease signing
8. Ability to post vacancies in the software

I found that Innago was the only one to meet all these requirements. It does charge a $2 fee for each rent payment, but that is charged to the tenant by default. I haven't had any complaints from tenants about this charge.

The other softwares were pretty good, but here are the deal breakers for each.
Tenant Cloud: Tenants cannot setup autopay unless we have the paid version
Apartments.com: You cannot upload your own lease, you can only make modifications to their lease
Avail: You cannot upload your own lease, you can only make modifications to their lease
RentRedi: No free version

***I investigated these softwares 8-12 months ago, so some things could have changed. For example, you get a discount on RentRedi if you are a BP Pro member that could potentially make it a contender with Innago for my use.

Good luck :)

We've been super happy with our first investment!

If anyone is interested in learning more, check out this podcast episode where I discuss how we were able to get a loan before graduation, which supplies we provide to our tenants, and more!
https://open.spotify.com/episo...

I am using Innago, and I cannot recommend it enough.
My requirements for software were:
1. Must allow for completely custom lease
2. Must be free for me (tenant pays $2 per transaction with Innago)
3. Automatic Online payments
4. Auto late fees
5. Maintenance requests
6. Applications
7. Background checks
Innago was the only software I found that could do all of this! And it has worked great for the 3 tenants I've been managing for 6 months 😁
I'm sure there are other good choices too, but Innago is definitely a great one :)

I'm not sure exactly what your strategy is, but here is my list of sites for each strategy. I'm currently rent-by-rooming, so I haven't used all the sites listed. I just compiled this list for whenever I do use another strategy.

Traditional Long Term Rental:
- Zillow
- Realtor.com
- Hotpads
- FB Marketplace
- FB Groups
- Apartments.com
- Craigslist

Rent-by-room Rental:
- FB Marketplace
- FB Groups
- Zillow
- Roomies.com
- Roomiapp.com

Short-Term-Rental:
- Airbnb
- VRBO
- Flip Key
- Booking.com

Medium-Term Rental
- Furnished Finders
- Kopa.co
- Airbnb (with 30 day minimum stay)

Great question! You are allowed to have more than 1 owner-occupant loan at a time. So theoretically, you could House-Hack 1 per year, getting a new owner-occupant loan each time.

You may hit some limits that would keep you from acquiring 1 per year with conventional financing indefinitely.
1. Freddie/Fannie allow you to have 10 conventional loans at any time.
2. To qualify for a loan, the lender looks at your Debt-to-Income ratio (DTI). Your debt is the amount you owe in mortgages each month, and your income is your personal income and your rental income. So if you have too many negatively cash flowing properties, you may eventually have a DTI that is conventionally unlendable.
*DTI calculation can be a bit complex. Depending on how long you've had a property, they may not consider your rental income (I think), and they may not count short-term-rental income (I think). Also, DTI can include Insurance and Taxes as part of your Debt (I think). So definitely reach out to a professional, 😂.

I'm renting-by-room, but I considered furnished medium-term-rentals (like you are discussing), and STR.

One reason you may not want to go the MTR route is that it can be difficult to find a manager in that space, at least in my market.
If you are willing to self manage of if there is a manager in your market, it could be a great strategy though! More cash flow/more work than LTR and less cash flow/less work than a STR.

So it is kind of a sweet spot :)

@Ben Einspahr @Chris Lopez
🚀 I had a blast explaining how we were able to house hack early by being proactive.

If anyone is looking to invest in Colorado Springs, definitely reach out to Chris. He, and his company, are the best in the business for serving investors. In fact, Ben's primary job is to coach House Hackers! An incredible amount of value that you likely won't find with another brokerage.

I can't wait to come back onto the podcast and discuss future acquisitions 🚀

Ah good question. We include all utilities, internet, lawn care, etc in that rent amount I discussed. We have 5 bedrooms, so splitting it up would take some additional work but it's doable. 

It is customary to include utilities in my market though, so I think it would be difficult to rent it for the current amount of we didn't include utilities.